The son of commander-in-chief Min Aung Hlaing paid the Yangon regional government cut-price rent for a property where he runs an upscale restaurant and gallery after getting the permit without bidding against other businesses.
Aung Pyae Sone won the 30-year permit to lease the land for the restaurant in People’s Park in 2013 but faced no competition from other companies beforehand, according to a report by Yangon’s auditor general.
The Yangon Restaurant, which serves pan seared scallops, veal and foie gras, was one of at least seven business permits the tycoon won after his father, Min Aung Hlaing, was promoted to the role of Senior General in 2011.
The restaurant also serves alcohol despite the fact this is prohibited in its contract with the Yangon City Development Committee (YCDC).
Until March last year the establishment paid YCDC a monthly rent of 1 million kyat, less than $1,000, for the more than 1-acre compound, which also includes an art gallery.
That works out at just over 16 kyats per square foot. YCDC in 2016 charged more than 3,000 kyats per square foot for a different lease in Dagon, the same township where the restaurant is based.
In 2018, following a complaint by a regional MP the previous year, YCDC raised the rent to just over 10 million kyat per month.
Aung Pyae Sone declined to speak with Myanmar Now for this article. “I won’t answer the questions, brother,” he told a reporter who contacted him by phone, before hanging up.
The 2018 contract, seen by Myanmar Now, says that “the renter must not… sell alcoholic drinks and beer.” On a recent visit to the restaurant a Myanmar Now reporter ordered a coffee and a beer. When the bill arrived there was a separate receipt for each drink and staff only stuck tax stickers to the receipt for the coffee.
Kyaw Zaya, an MP in the Yangon regional parliament, told a parliamentary meeting in 2017 that the restaurant was among several businesses underpaying the government in People’s Park.
“The restaurant is next to the People’s Square. This big restaurant sells many foreign branded liquors [that are] very expensive,” he said. “I am just pointing out the rental rate is very low.”
The MP also said that the restaurant had cut down trees to build a car park. The 2018 contract bars the tenant from felling trees.
Ko Ko Lin, head of the Playgrounds, Parks and Gardens department at YCDC, signed the contract with Aung Pyae Sone on behalf of the department. He told Myanmar Now his department set the low rental rates for land inside People’s Park under instruction from the government.
“We only lease the land when the government says to lease the land at this rate,” Ko Ko Lin said.
In total, YCDC collected 3.9 billion kyat from the businesses operating in People’s Park between 2017 and 2018, said Ko Ko Lin. The year before that it collected 2.5 billion kyat, he added. But he declined to disclose how much the government collected before the NLD came to power.
In May Ko Ko Lin’s department proposed that YCDC should increase rents for municipal lands starting next year, he said, but the proposal is still under review.
U Than, YCDC’s joint secretary, denied that the government had lost out on any funds by undercharging for rents at People’s Park.
“The country did not suffer financially as the committee leased the land at the set leasing rate. We set a rate that is fair for both the country and the business owners,” he said.
Kyaw Zaya, the regional MP, said he opposed simply amending the contracts to increase the rents, and instead wanted to see a public, open bidding process where companies competed for the permits
“There was no tender, they just signed contracts with their own people,” he said. The business currently operating should have to win a tender to continue operating there, he added.
Daw Hlaing Maw Oo, YCDC’s secretary, said it was not easy to terminate contracts that were signed under the previous government. “The must be negotiations between the two parties to amend a contract,” she said.
After his father became the commander-in-chief in late 2011, Aung Pyae Sone obtained permits to establish several businesses, either under his own name or his wife’s, in healthcare, construction, hotels and other sectors.
Earlier this week the US State Department hit Min Aung Hlaing and three other military leaders with travel restrictions in response to widespread reports of human rights abuses in Rakhine state and other parts of the country.
